The Business

A lesson for all business on the rise of social media

Updated
October 09, 2012 23:06:18

Sydney radio shock jock Alan Jones has dismissed it as 'cyber bullying' but the social media onslaught which has cost his employer hundreds of thousands of dollars in lost advertising has ramifications far beyond the walls of 2GB.

TICKY FULLERTON, PRESENTER: Sydney radio jock Alan Jones has dismissed it as "cyber bullying" but the social media onslaught which has cost his employer hundreds of thousands of dollars in lost advertising has ramifications far beyond the walls of 2GB.

What started as a protest against insensitive comments about the Prime Minister's late father has become a lesson for all business on the rise of a seemingly unstoppable force.

Andrew Robertson reports.

ANDREW ROBERTSON, REPORTER: In the land of radio shock jocks, they're always right and everyone else is always wrong.

ALAN JONES, 2GB RADIO: You big hero, Mr McCarthy. How many phone calls did you make to me? You absolutely gutless wonder.

ANDREW ROBERTSON: But in the real world, even though Alan Jones won't admit it, he's fighting a force that may even be bigger than him.

ROB BELGIOVANE, CREATIVE DIRECTOR, BWM: If you go to things like the Cannes Advertising Festival which is the global market for this type of thing, it's all people talk about.

ANDREW ROBERTSON: BWM is one of Australia's leading advertising agencies, and Rob Belgiovane says social media has revolutionised his industry.

ROB BELGIOVANE: The decision to purchase a particular product or service - or listen to a particular radio station for that matter - is driven almost, I'd say, 80 per cent by advice from friends and family via social media, as opposed to being driven by the traditional media.

ANDREW ROBERTSON: Which means the social media stakes for business are now high, and that's why strategist James Griffen believes management needs to start taking it much more seriously.

JAMES GRIFFEN, PARTNER, SR7: We would certainly advise that companies considered creating a steering committee, for instance, for social media, which has members of legal compliance, HR and marketing to all be involved in social media.

ANDREW ROBERTSON: 2GB's decision to suspend all advertising on the Alan Jones program is estimated to be costing it around $80,000 a day. James Griffen says it's an excellent example that the risks from social media are now very tangible.

JAMES GRIFFEN: Some smart companies are starting to do some research and understanding, "Well, perhaps we could insure against social media risk in considering it might lose us this much money per annum or per week or per quarter and what can we put in place to deal with that".

ANDREW ROBERTSON: However, rather than insurance, corporate adviser Cassandra Kelly says the best defence against a high-tech social media attack is low-tech customer satisfaction.

CASSANDRA KELLY, JOINT CEO, POTTINGER: I think they need to make sure firstly they have good products, that they've listened to what the customer wants, and that they continue to engage with their customers to make sure that they're giving them the services and the experience the customer needs and desires.

ANDREW ROBERTSON: The question for sponsors of the Alan Jones radio program is when to return, knowing that when they do return they will again be running the gauntlet of social media. For BWM's Rob Belgiovane it comes down to an essential issue, that's selling products. And like him or loathe him, Alan Jones is the king of the Australia's biggest radio market.

ROB BELGIOVANE: If you've got a brand and you're not advertising with Alan Jones - or for that matter the other person that get a lot of negative publicity, Kyle Sandilands - you've got a problem.

ANDREW ROBERTSON: One thing Rob Belgiovane is also sure of is that before Alan Jones makes his next gaffe he should be paying closer attention to the growing voice of social media.